Nursery costs rise by 7% while spaces drop, survey suggests

A part-time nursery place for a child under two now costs an average of £158 per week while only a third of English council areas have sufficient childcare for full-time parents, the latest annual survey of the Coram Family and Childcare charity has found.

The research shows that the cost of 25 hours per week for a child under two had risen by 7% on 2023 with the most expensive area being inner London where the average cost is £218 per week.

A total of 34% of English councils reported sufficient childcare places which was a decrease of 14% on the previous year while 35% reported having enough spaces for children under two.

The survey also points to a drop in childcare places for children with disabilities with 6% reporting sufficient spaces, which is down 12% from 2023.

A Coram spokeswoman said: “Today’s report also reveals councils’ concerns over the delivery of the expansion to free early education entitlements, which start from April, and the further impact on the availability of childcare places.

“While 63% of councils in England are ‘confident’ or ‘very confident’ that there will be enough places to meet demand for the imminent expansion (15 free hours for two-year-olds), just 28% say the same about the expansion from September 2024 (15 free hours from nine months), and this falls to just 12% for the September 2025 expansion (30 hours from nine months).

“In addition, the vast majority (90%) of councils identify the local childcare workforce as a ‘barrier’ to successful delivery of the 30 hours free entitlements in 2025, reflecting the significant ongoing challenges to recruit and retain staff.”

Ellen Broome, managing director of Coram Family and Childcare, said: “The new childcare support that is being rolled out from April has the potential to be a game changer for parents up and down the country – many of whom have found themselves facing eye-watering childcare bills and sometimes even locked out of work because of childcare costs.

“Our findings – with higher costs and dramatic drops in availability of childcare places – are concerning at this crucial time, showing the scale of challenge and the very real risks around this policy not living up to parents’ expectations.

“Unless this policy is properly funded and supported, it could have the opposite effect, with families unable to access or afford the childcare they need and the most disadvantaged children set to miss out.

“The recent additional funding from the Chancellor was welcome but won’t address the long-term systemic challenges of high childcare costs for parents, the workforce recruitment and retention crisis or the lack of availability of places for children with SEND (special educational needs and disabilities).

“Over the next few months, we need the Government to work closely with local authorities and childcare providers to make sure they are supported to deliver for families.

“And in this election year, we are calling on all political parties to commit to reforming our childcare system to make sure all children can access high-quality early years education and all parents can make meaningful choices about work and care.”

“However, historic underfunding and wider council pressures have left local authority early years teams less prepared to support providers with the expansion, despite concerted effort.”

Paul Whiteman, general secretary at school leaders’ union NAHT, said: “Too many nurseries simply don’t have enough funding – meaning they are unable to offer more places or increase pay sufficiently to help tackle the severe challenges they face in staff recruitment and retention.”

He added: “The Government can make all the promises and reassurances it likes, but until it backs them up with the investment needed its plans to expand services are bound to fall short of parents’ expectations.”

A Department for Education spokeswoman said: “Our largest ever expansion in free childcare is set to save parents using the full 30 hours up to £6,900 per year, tackling the cost pressures parents are currently facing, with the first stage of the rollout beginning in just two weeks.

“We are confident in the strength of our childcare market to deliver further expansion, with our funding rates for the new entitlements independently assessed by the IFS as significantly above market rates, guaranteed further rises in funding for the next two years backed by an estimated £500 million, our national recruitment campaign, and £1,000 cash incentive pilot to encourage new staff into the sector.

“Even before these interventions, early years places and staff had increased in 2023 compared with five years ago, while the number of children aged 0-5 has dropped year on year between 2018 and 2022.”